Olli Rehn, the EU’s Economy Commissioner, stated yesterday that the details of Portugal’s rescue programme were decided by the Portuguese government and not by the Troika.
Rehn was responding to questioning from the MEP Elisa Ferreira about the evaluation of the work of the Troika in those countries that had to be bailed out.
Asked about the privatisation of Portugal’s national power companies, EDP and REN, Ferreira was told that these privatisations were "a decision by the Portuguese Government within the framework of the programme."
Asked about the cuts in pensions in Portugal the commissioner said that "it was also a decision of the Portuguese Government in dialogue with the (Troika) institutions."
During a hearing with MEPs, Olli Rehn stressed that "the Troika works reasonably well," particularly given the urgency with which it was created, in just a few weeks.
"Europe had quickly to create structures that did not exist," said Rehn, adding that "it was necessary to make compromises."
The Commissioner considers that the hardest time the EC had was with the previous Prime Minister José Sócrates who was in charge at the time and who delayed the bailout request at a time when all of Europe has realised that it was inevitable.
"We had many periods of challenge with Portugal, but I think, in fact the worst, or most critical was the period prior to the programme, because we had many discussions with the Minister of Finance long beforehand"… "it was very clear that sometime in 2010 Portugal that, unless there was very strong action in terms of economic reform and consolidation, the interest rates on government debt would continue to rise until they become "prohibitive," which of course they did.
